Pennsylvania Capital Files For Bankruptcy

HARRISBURG, Pa. – Pennsylvania’s distressed capital city filed for bankruptcy Wednesday, citing “imminent jeopardy” from lawsuits related to a debt-saddled municipal incinerator and setting up a power struggle between the mayor and City Council.
The federal petition for Chapter 9 bankruptcy, being sought to help Harrisburg get out from under crushing debt, listed about $458 million in creditors and claims and six pending legal actions by creditors.

“The city does not have the ability to pay those money judgments or any significant portion thereof and still provide health and safety services to its citizens and other essential government services,” wrote Mark D. Schwartz, an attorney hired by the City Council.

A spokesman for Mayor Linda Thompson, who has resisted calls for bankruptcy because of fears that it would further blemish the city’s name, said the council lacks the legal authority to seek it.